more Halliburton fun

[sisyphusshrugged]

I'm not sure this is the kind of track record we were looking for in a contractor

...The other case of overcharging involved the supply of mess halls, and the Pentagon said it had found evidence that KBR may have overestimated the cost of catering by $67m.

Investigators at the Defence Contract Audit Agency are now examining all aspects of financial controls and subcontracting arrangements by KBR in Iraq, with around 20 auditors having been assigned to the job.

In a statement, David Lesar, the chief executive of Halliburton, said: "We welcome a thorough review of any and all of our government contracts."

Mr Lesar defended the company's performance, and said that the questions were "a normal part of the audit process and not a condemnation of KBR processes".

However, Democrats - who have criticised the lack of competition for contracts in Iraq - were quick to lay into the Bush administration.

"We've recently learned what many Americans have suspected for a long time - special interest contributor Halliburton is overcharging the American taxpayers," Howard Dean, the Democratic presidential contender, told the Washington Post.

"Now this president is preventing entire nations from bidding on contracts in Iraq so that his campaign contributors can continue to overcharge the American taxpayers."

Mr Dean was referring to a White House decision earlier this week to block firms from countries opposed to the conflict in Iraq from bidding for contracts, worth $18.6bn, to rebuild the country.

The move caused predictable outrage in the countries affected, which include France, Germany and Russia. However, companies from Britain and Italy - which were coalition partners - are eligible for contracts.

Kofi Annan, the UN secretary general, has urged the administration to reverse the decision, which he called "unfortunate", and the EU has raised the possibility that the US move violates World Trade Organisation rules.

The discovery that Halliburton could have overcharged the US government is certain to add to the arguments raging over Iraq's reconstruction. Halliburton has been under intense scrutiny ever since it was awarded a no-bid contract to provide billions of dollars in services in Iraq.

Critics of the Bush administration say that Halliburton has benefited from White House patronage, because the company is a big donor to Republican party coffers.

It gave $708,770 in political contributions between 1999 and 2002, with 95% of that going to Republicans. Administration officials counter that few companies have the resources and expertise to carry out the work needed.

Mr Cheney, a former defence secretary under the first Bush administration, stepped down as chief executive officer of Halliburton when he became Mr Bush's running mate in 2000.

He has said that he played no role in contracts for his former company, of which he became head in 1995.

KBR was first criticised in the summer by Congress for charging high rates to bring petrol into Iraq from Kuwait, but there have been accusations of overcharging before.

Last year, the firm paid $2m in fines to settle charges of inflating prices for repairs and maintenance at Fort Ord, California.

In 1997 and 2000, the General Accounting Office, the congressional watchdog, found that KBR had billed the army for questionable expenses on its support contracts for operations in the Balkans.

Those reviews cited instances such as charging $85.90 per sheet of plywood actually costing $14.06, and billing the army for cleaning some offices up to four times per day.